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An Early Education in Financial Literacy

Last week J.D.’s wife, Kris, e-mailed me about an NPR story on a recent Girl Scout badge overhaul, specifically about merit badges for financial literacy. On the October 12 episode of Today on All Things Considered, host Guy Raz talks to Alisha Niehaus of the Girl Scouts of the USA about the update, the first major restructuring of the badge system since 1987:

“…we’re really a girl-led, girl-driven organization,” says Niehaus. “So we went to the girls and we said, what are you interested in learning, what do you think will prepare you for success, and what do you want and need for the next century? So that’s how we got all our new categories.”

According to a TIME article on the new program structure, if one of the nearly 3 million girls in the program wants to explore an area of study not already covered by the 100-plus merit badges, she can design her own area of study.

Girl Scouts aren’t just about cookies and camping anymore. Changes to stay relevant and reach the modern girl come amid a drop in cookie sales and donations and investment losses. In 2007, Scouts lost $1 million nationally in membership dues and an additional $1 million in donations.

Merit badges for financial literacy
Many of the traditional badges will stick around, such as cooking, athletics, first aid, and nature badges. New badges added to reflect modern times include the following:

Digital movie maker

Website designer

Computer expert

Geocacher

Locavore

Another new category of merit badges is financial literacy, with 13 types of personal finance badges, each earned by completing five activities. As a girl works her way from Daisy to Ambassador, she can earn some of the following money-related badges:

Money manager

Budgeting

Financing my future

Good credit

Philanthropy

The activities vary depending on age, with activities for 5-year-olds like recognizing different coins and activities for preteens like drawing up a budget. (Boy Scouts already have a “personal management” badge that requires them to complete activities like comparison shopping and stock market research.)

Of course, this is in addition to the cookie-related badges, such as “meet my customers”, “business plan”, and “customer loyalty”, meant to help girls develop the following five key skills:

Goal setting

Decision making

Money management

People skills

Business ethics

“The cookie sale is a $700 million business run by girls, and those badges are a practical way of putting their financial literacy to action,” Niehaus told MSNBC.

Benefits of an early education in financial literacy
The changes to the program are meant to give girls a more robust education in finances, and the younger they start learning, the better. A recent Forbes article explored the importance of an early education in financial literacy for girls:

She says, ‘Financial literacy training instills girls with the knowledge and the confidence they’ll need to be economically independent. They’ll be less likely to feel trapped in unhealthy relationships because they have no means to support themselves. Girls who are financially literate are also better able to identify economic injustices in the world around them. A greater understanding of pay inequities, poverty, and economic abuse means that girls will be more prepared to fight for equality and justice for all girls and women.’”

The implications of a financial education extend far beyond having an emergency fund or contributing to a Roth IRA — it could help someone avoid or break free from an abusive relationship. The Forbes article explains that personal finance is often left out of the equation in helping abuse victims, but according to the Task Force to End Sexual and Domestic Violence Against Women, about half of all victims of domestic violence victims lose a job because of abuse, particularly detrimental in a lagging economy. Abusers also use finances as a way to control their victims, including:

Cutting off access to money or the means to earn it, thereby making the victim dependent for food, shelter, and clothing

Refusing to let the victim keep a personal bank account

Stealing from the victim

Exploiting the victim’s assets for personal gain

Forcing the victim to obtain credit in his or her name, eventually ruining the victim’s credit score

Teaching kids about credit, budgets, and money management at a young age gives them the economic power to take care of themselves, which is an important factor in avoiding or freeing themselves from an unhealthy relationship.

Getting kids interested in finances
There are numerous ways to make sure your own kids get a financial education.

Phone apps. Do your kids like to “borrow” your smartphone? “There are apps for younger kids that focus on budgeting and saving,” says Glazer. “For instance, the Kids Money app for the iPhone teaches about saving for long-term purchases, like a new toy. Android smartphone users can try Kids Shopping Calc, which teaches budgeting by shopping in a virtual store with a set amount of money.”

While these are all great methods to get kids interested in personal finance, I suspect that the most effective way to teach kids about money isn’t as expensive as summer camp or as high-tech as phone apps. Ask your young child to hand the waitperson a $2 tip; explain the family budget to your 13-year-old; or show your high school kid how to understand a credit card statement. Ongoing conversations about money with your children can be the best financial education of all.

This is an exciting trend. I have been working for years to implement more comprehensive financial literacy courses on the college campuses where I work with moderate success. For some reason, there is a push back from the administration.

However, I have found that coupling the need for financial literacy with the growing student loan default rates is usually enough persuasion to get a program started.

I think it would be much easier to implement these programs if parents started teaching their kids financial literacy principles as children, or if they had clubs and organizations that taught these as well. Good for the Girl Scouts!

Yes yes a thousand times yes! Teach these kids early and they’ll be much smarter than we were. How much financial education did I receive? Little to none, and most of what i learned was trial and error. Most of my contemporaries echo this. We had a required class in high school (1/2 credit) in consumer education, which was pretty worthless. The only thing I remember learning is how to inspect your first apartment. Yes – this is how they sent us out into the world. So what the Girl Scouts are doing sounds like a great idea to me.

I was very fortunate to have parents who spent a lot of time and energy when I was younger teaching me about finance. When I entered high school, we opened a checking account for me. I would get $100 a month deposited on the first and had to make that last all month. I learned to write checks, how to balance a checkbook, and what stuff actually costs. I was responsible for buying my school supplies, clothing, any entertainment, and later gas. I really learned to prioritize! When $100/month wasn’t enough anymore, I had to get a job. Luckily I already had an account to deposit that paycheck into, and had learned to manage any money that came in! These lessons have stayed with me ever since.

I have had success with using three jars taped together. One is marked “Save,” one “Spend” the last, “Give.” DS gets his allowance, he allots 10% for giving, 20% savings (minimum), the remaining 70% in spend. It’s a tangible way for him to seperate his money. I’ve seen piggy banks with these seperate spaces but taping the three jars together works fine for us. Plus, e got to use duct tape and a Sharpie.

About once a month, I take him to the credit union and he deposits it in his savings account.

For giving, he will buy his teacher some school supplies for the class room (this year it was two reams of copy paper), put it in the Salvation Army kettle during the holidays, buy food for a food bank, stuff like that.

However, I don’t think a checking account is all that important for kids younger than college age.

It is unlikely that any store would accept a check written by a kid (or an adult for that matter), and most checking accounts will soon have fees associated with them (who needs that?), and checks are unlikely to even be used 10-15 years from now–I hardly ever write any checks myself anymore.

Just get the kid a money market savings account and tell them they have to go to the bank to withdraw actual cash when they need money. Spending actual cash is a good way to be conscious about it! Or you could get them a prepaid credit card (paid for by the parent) and make them keep track online about “their” money that they spend that way.

My son has a guardian savings account, which is appropriate for a 6 year old. When he’s older (like 16 or 17), he will get a checking account with a debit card. I like the pre-paid card idea- maybe I’ll use that as a transition to a debit card.

His accounts probably won’t have fees because we bank at a credit union. They also give you a debit register- like a check register, but smaller. It fits in your wallet, and has a folder for the debit card and receipts.

I opened checking accounts with my daughters at our credit union when they turned 13. They use debit cards, and my older daughter occasionally writes checks for dues or other school/activity fees. Each year they’ll be responsible for more of their own expenses, so they’ll be ready for college and living on their own.

My older daughter is already learning about trade-offs, and she recently decided to skip the next 2 chorus trips (she earns money for trips through fundraisers and babysitting) so she can go on a school-sponsored trip to Germany in 2013 instead.

I hope that the lessons in their teenage years will keep them from overspending and out of debt for the rest of their lives.

The only financial education my husband and I received from our parents was that we could’t afford it (whatever “it” was) and that credit was only to be used for emergencies (broken water heater type things). I have to say, though, that they had no trouble letting their children acquire massive amounts of student loan debt.

My husband and I both got into some trouble with credit cards – which was due primarily to student loan debt, since neither of us has a very fancy lifestyle, but maintaining a minimum sort of lifestyle with massive student loans made getting into credit card debt very easy.

We eventually figured it out and have been debt free (other than our mortgage) for many years. I don’t think it’s necessary for very young kids to get any kind of formal money education, although I think a high school class on money management and credit terms is probably a good idea. However any class is going to be taught with a bias, – e.g. debts for thing like car and student loans are ok versus cash only. Theory’s great and necessary as far as it goes, but you really need to live in the world before you can figure out your own path.

I disagree that money education isn’t necessary for children before high school. It doesn’t have to be formal schooling, but the information that parents convey to young children helps them to form their life-long relationship with money. Even though you say that your parents didn’t teach you about money, the fact that you chose not to have a “fancy lifestyle” while you were carrying debt is most likely tied in part to hearing your parents talk about not being able to afford things when you were growing up. If your parents had been trying to keep up with the Joneses by using credit to purchase things they couldn’t afford, you might have had a different experience as an adult.

I think the way we, as parents, use money and talk about money both with and in front of our children, makes a huge impact on the way they will feel about money as an adult.

I actually agree with you completely which I suppose means I worded myself pretty poorly in my initial post. I do think it’s important for parents to convey to their kids a healthy sense of money management. I was more talking about how I don’t think formal money training for very young kids is necessary.

The Girl Scounts website used to have a “price per wear” calculator that I found very useful with tweens & young teens – okay, you want $120 shoes. How often would wear them? How much would that be per day of wear? So maybe the $120 gym shoes for everyday school wear are worth it but $120 shoes for Prom aren’t.

My 6 year old gets the difference between price per ounce and price per package at the grocery store, and we do the math to compare sale prices on name brands vs. generics.

I disagree that financial literacy is not necesary for the very young. Actually Sesame Street recently started promoting financial literacy for the young as well. I already had my children watch it. http://www.sesamestreet.org/save We use the “envelope system” and have since they were 4 (“save”/”spend”/”Give”). Now my children (8 and 5) actually have a budget and have to plan and budget their own b-day parties. It really helps them learn the value of money and how to make choices.

In terms of high school lessons, my husband teaches high school and it is sad how little high schoolers understand–VERY few parents sit their children down when they do the bills so the children have very unrealistic expectations when they graduate college. Since my husband teaches computers, in teaching them spreadsheets, he makes them plan a budget for when they graduate college, having them research the salary from their chosen career, the payments for a car/house, and all other expenses, working with their parents to make sure all expenses are factored in. Then, after they have it together, he corrects the salary to reflect a starting salary (very few students start with a starting salary and look to an average in their field) so the students have to re-do their work. Then, he provides them with a tax table, and suddenly, the kids realize that the lifestyle they are currently experience (by living with parents that have an established career for 15 year or more) is very different from your lifestyle when you first start out. Kids actually need this education before high school becauseonce you hit high school, everything counts toward college. Kids that learn this lesson in their second or third year of high school have lost out on lots of valueable options, including options of getting college credit for high school classes. One needs to know where they are going before the journey begins or it costs more and takes longer to get there.

So why not give children real world experience while they are young? There is no rule stating real world experience comes after they leave home.

Besides, making financial mistakes while they are young is by far less serious than when they are older and provides quite an education.

This is one of the reasons I started Kidbudget. Its a system that teaches children basic sound financial principles. It is very different in the way kids learn – they will like it – and is based on things they do in the real world.

The greatest asset is that it provokes conversations with the child and the parent.

Great article, April. I remember having conversations with my father about money things as a kid and I always gave him a “yeah yeah yeah” and rolled my eyes thinking that I wouldn’t have to worry about it until later. I tried REALLY hard not to listen back then but still, as the time came around, and later became now, I found myself actually remembering some of the stuff he said.

Even if your kids seem like they’re not listening at all when it comes to money, savings and finance, still go for it. Chances are, they’re assimilating more than they’ll know or admit.

This is a wonderful article. I am all about educating finances to the young kids especially girls. I am also against domestic violence. As I am reading this article, I can’t help but to think about my father. I feel like every single line of ways to control victim is referring to my parent’s relationship. Growing up, I thought it was “normal” for women to not work and depend on the husband. My father also ended up ruining my mother’s credit. Thanks to him, I became extremely responsible with my own finances and started reading as much as I can about credits, loans, legal aspect of financials, credit score, investment and anything I can learn regarding personal finance. I think what they are doing for girl scouts is wonderful. When I have children one day, I would like to put them in girl/boy scout programs.

I heard the NPR story as well. I’m impressed that the organization is trying to stay current, rather than just holding tightly to an idyllic past that probably didn’t actually exist. This group may just make my donation list this year – will need to do a little reading first!

I especially appreciate the point about “the connection between financial freedom, healthy relationships and social justice.”

This can really motivate parents, as they understand that financial education affects more than just their child’s financial life. In the future this will be as important for boys as for girls. Current trends indicate that as more women get higher educations/higher salaries, it will be more common for men to be the lower-earning member of a couple. As a Gen-Xer, this is actually the norm among my friends.

While phyisical abuse most often (not always) involves a male abuser, emotional abuse is just as easy for a woman to perpetrate against her male partner. Financial control can be a big part of that, especially when there are children involved.

*Every* person should have the financial freedom to walk away from an unhealthy relationship!

“*Every* person should have the financial freedom to walk away from an unhealthy relationship!”

Hear, hear! My mama always said everyone (women AND men) needs a “Good bye, jerk!” account- if things go south and you need to get out ASAP, you will have the money to support yourself/kids and say good bye to that jerk.

I think it’s great that people are realizing that their kids will be better off if they have a sound understanding of how money works before they leave the nest. There is something to be said, however, about how quickly we make kids grow up these days. I think we should be careful not to steal someone’s childhood away while trying to protect them from the future.

I think it is important for kids, especially girls, to learn about money and personal finance. I wish there was a way to roll this out to poorer kids. (I don’t know what the demographics of girl scouts are, just basing this off the fact that I was too poor to be a girl scout because we couldn’t afford the fees and uniform and stuff, and I have never had a client whose kids were in the girl scouts…)

Please check with the Girl Scouts council in your area. There isn’t a required uniform anymore, just pins that the troop provides, and scholarships are available for needy girls who can’t afford the dues ($12/year in our council). The leaders will work with the council to get the girls vests or sashes for their badges and patches.

Men and women can be leaders/volunteers, and Girl Scouts doesn’t discriminate. My older daughter had a lesbian leader who had adopted special needs kids with her partner, and their girls were part of the troop. Girl Scouting is for all girls! 2012 is the 100th anniversary year–see how you can help girls get involved.

I’m a girl scout leader and can tell you from first hand experience that we had girls from all walks of life in our troop – from families with means and from families without means. We told our parents at the very first orientation meeting that our policy was to help the girls figure out what THEY wanted to do and how THEY would do that, without going home and asking for money. Our girls used the Fall Product sale and the Girl Scout Cookie sale to raise funds each year – enough funds to take themselves (4th and 5th graders) on wonderful adventures – one year all the way from central PA to Assateague Island, and other years to Washington DC. We’d stay with friends or camp, always looking for ways to do things inexpensively. Talk about developing pride and a belief in themselves! Many of the parents loved to see their daughters have these opportunities, especially if they couldn’t have afforded it for the whole family.

Girl Scouts is a wonderful organization, and has been doing a fantastic job lately of trying to stay current while not losing its history and ideals. Happy 100 year anniversary, Girl Scouts!

The only thing about girl scouts that i liked was earning badges! (Every time that overnight camping was on the agenda I got an infectious disease — chickenpox, mumps whatever — that’s how much I didn’t want to participate in that!) BUT, thinking back, I wonder how much bias there is in the way certain badges might be presented and defined. Although I admire JD’s ability to keep politics out of GRS, one can’t deny there is a political/philosophical component of financial knowledge.

Well, sure, in human life everything has a political aspect, everything advances or perpetuates an ideology of some sort. Everyone has values acquired in their social class or ethnic group or local community, and it’s naive to think we can keep this conflict of values out of everyday discourse.

The only way to achieve the “apolitical” ideal is if everyone shared the same politics to the point that politics became invisible and free of conflict, and I sure wouldn’t want to live in that kind of world!

I was thinking about this blog’s policy (there’s that word) a few days ago, in light of some recent discussions, and I think what JD is trying to do is to keep the most dogmatic forms of partisanship at bay and to keep discussion civil– which is political in an of itself, of course.

If you want to set kids up to succeed in life money management will play a huge part. In Canada (at least where I live) they’re looking to incorporate financial literacy into the school curriculum – finally! I’ve been teaching my kids about handling money for awhile now and in my research came across Moonjar (www.moonjar.com) and thought it was neat way to get kids excited about it at an early age.

Interesting. Haven’t been a big fan of girl scouts in the past, but I’m loving the update of the merit badges. Particularly, since we are getting such minimal ‘real world’ skills during our school years.

I grew up ‘working poor’. My parents didn’t make squat. My Mother told me from a very young age, that everything we had was as a result of credit. You’d think this is bad. To my mother protecting your credit and your credit score was the utmost priority. I always knew that you pay your bills first, and on time, you don’t bounce checks (overdraw), and your certainly don’t over extend. Otherwise, your credit won’t be there for you when you need it. They obviously were not good savers, so thats a skill I’ve had to master myself. But Mom was a master of finding low interest/no interest deals to finance whatever we needed (and they were needs) at the time.

The financial education I received from my parents consisted of teaching me how to ask them from money until “no” became “yes”. Eventually I managed to get an allowance, but in a country with hyperinflation I always had to plead for more, until I started making money as a tutor/teacher/gypsy cab driver,–although that wasn’t enough for much. I had to move away from home and start working to really begin to understand money, and it was a hard, stupid way to learn about it.

Growing up though I never knew how much my dad made or what was the home budget if there was one. It was rude to talk about money so we never knew the price of things. Also, my parents often fought about money (my mom needed more, my dad protested at the expenses). Hyperinflation was stressful for everyone.

My parents are nice, decent, well-meaning people, and I never lacked for anything (food, shelter, clothes, medical care, schooling) while growing up. They were just clueless about educating their kids about money–even though my dad was a successful CFO…! Which goes to show that personal finance is *personal*. You can be great at math, you can be great at managing other people’s money, but family life is a different story, everyone carries baggage of some kind, and therapy is often a prerequisite for math.

Anyway, I had to learn my lessons the hard way, and when I have kids I hope I’ll teach them better. Of course I’m sure they’ll find some other thing to complain about, like “my parents never let me eat twinkies” or “dad would spend days in front of the computer”, ha ha ha. Eh, we do what we can.

my favorite thing about my son having his own money (that he “earns” at a set rate for chores/learning new habits) is never, ever, ever having to listen to begging. He wants a toy. Does it cost more than he has? End of discussion.

The price is having to patiently listen to his lengthy and emotional decisionmaking when he *does* have the money, but even that has been getting better as he gets older.

I sat down with my high school age kids and had them write out the checks for the monthly bills. They would generally hyperventilate while they were writing multiple checks for hundreds of dollars each. I didn’t get any more questions about why we could not afford whatever.

Has anyone here actually looked at the new GS books and what the new badges are? I have. I’m a GS co-leader and currently have 5th graders (Juniors).

The old books had cookie sales and money management badges too.

Old Book badges – Money sense, Business-wise, Cookie Connection, Consumer power + 100 other badges to earn at this level.

New Book badges – Cookie CEO, Customer Insights, Business Owner and Savvy Shopper

The badge that taught about money, credit, interest and savings (money sense) is alas, no longer part of the new Guide to Girl Scouts.

The new girl scout guides have 11 badges to choose from. The 3 “add on” packets that each have 5 more (for a total of 26) are not yet available. So we’re all anxious to see what these new badges will be about – Geocacher is one of these that isn’t available yet.

So having a “make your own” badge looks cool and fun, but one a year (all that the girls are allowed to do) isn’t going to make up for the 70+ old badge options that were taken away….

This emphasis on cookies and “leadership” is why my daughter and I left GS. There was always a financial literacy cojmponent, now the girls are being turned into little business nazis – primarily concerned with selling cookies to raise money (ostensibly for themselves but troops get less than 15% of the sale price). Used to be money was a part of the program. And to teh above poster – “no uniform but pins” means no public identity and will help lead to the demise of the program.

I’m sorry that you and your daughter didn’t have a good experience. A good leader makes all of the difference in the world. Girl Scouts here wear vests or sashes at all official events, and the troop/council will help the kids who can’t afford to buy them. So in this case, they are visible when doing service projects in the community. The girls don’t have the wear the shirts/pants/skirts/hats that were required when I was a kid, just a white top and khaki bottoms that many will already have or be able to wear at other times.

Once my daughter hit high school, I sat down with her and worked out a reasonable clothes allowance. She now has to purchase all her clothes and shoes from that budget.
It’s worked really well. No more pleading for new clothes – she has to manage things herself.
Love seeing her deciding whether to go for cheaper or more expensive brand options.

My parents managed their money very well, and talked the talk, but they did not *show* us how they managed their money. I think they were either afraid that we’d argue with their choices, or that we’d tell someone (the neighbors?) how much money my dad made, or something.

As a result, I had some weird ideas about money growing up. My dad is an engineer, and I thought that engineering was a poorly paid profession because we lived in a cheaper neighborhood than all of my classmates at our expensive private school. My mom drove an older Ford instead of my classmates’ moms’ late-model Mercedeses, BMWs, etc. We didn’t belong to a country club or go on ski vacations. So I (and my friends) thought my family was poor!

If my parents had been more open about money and their choices, I would have seen just how much they were spending to send us to that school, how much they were putting aside for retirement (I have zero worries that I will have to take care of them in their old age), and how they didn’t waste money on interest payments for expensive toys and trips, but instead paid cash for good-value cars, dance and music lessons for us, etc.

Today I believe the expensive school wasn’t worth it – it gave me a very skewed idea of how much money was “enough” and how “normal” people live. But in general, I have a huge amount of respect for my parents’ choices, and wish I’d known enough to *understand* them sooner.

Ha! I also second-guess my parents’ choice to send me to a fancy private school where all of my friends’ parents made way more than my own parents’ (upper-middle-class) salaries). It was a great education, but an odd experience socially. I actually think it left me very frugal precisely because I spent a lot of time feeling poor despite actually leading a very comfortable life!

My daughter was in Girl Scouts. She was a Mariner scout and achieved her Gold Award (equivalent to Eagle Scout). I attribute a lot of what she learned in scouting to her success in life. I wish, she had some of these new opportunities.
I involved both of my children in my businesses, daily life and investments
I encouraged savings as the cornerstone for personal finance. They told as a dults that they learned much more from my wife and I as role models.

Thanks for your post. Many of the ideas you present are spot on. I am a huge fan of increased financial education for women. There isn’t enough of it. We need more.

In particular I like the focus on early childhood education. It seems that most habits that sustain the test of time are instilled during one’s young years (e.g., progressive public education reform particularly focuses on this time).

I also like how there are 13 separate badges within personal finance. Personal finance is a discipline and requires several different areas of expertise. This is the right way to break it up.

I disagree however that this is the full solution. More is needed. Education alone has failed for decades in changing American’s habits with money (e.g., 401k participation rates).

Additional areas to focus on include:
- systems and automation of personal finance
- psychology & its roll in effective financial discipline
- corporate advertising and its role in personal finance

It’s an important point that financial education has in many respects failed for years. Yes, it hasn’t necessarily been instituted in our schools, but messages like “invest in your retirement” have been shouted from the mountain tops by the Government and large banks for years. The result has been less than stellar.

Great article – I think one of your KEY takeaways is how financial literacy (and independance) can help protect from a myriad of social injustices. the make your own badge isn’t new – they had that one when I was in Girl Scouts (and it was a LONG time ago). tehy also had a beauty badge and a statistics badge, really diverse options, hopefully when my daughter gets there the same fun options will be there for her too.

Starting a person’s financial education early is important. Kids need to understand what money is and what role it will play in their lives. Knowing how to value and manage money will be invaluable skills for kids to acquire, especially since the economy is so unpredictable. Kids need to understand how to build credit, use budgets and how to plan for their financial future.

Financial literacy for the young is very important. Too many people get into trouble when they get to be adults because they didn’t learn basics when younger. As a parent to a child in girl scouts, I was glad to see the inital part of this post. Thanks for sharing.

This is a great article; I too liked the corollary between financial literacy and the power to break free from abuse.

One thing I’m seeing in many of the readers’ replies is that parents need to teach financial literacy to their kids. I say, yes, but…it still needs to be taught in schools. To assume parents CAN teach financial literacy is like assuming parents can teach higher math: some can, a lot can’t.

I’ve been requesting that my son’s high school think about offering even a one-shot class/talk/seminar on personal finance. So far, there’s no interest in doing so – “the parents can teach that.” Despite the fact that 50% of the students qualify for low-income breakfasts & lunches.

I’m not sure how you can break a cycle of getting into debt/modern indentured servitude if you ask the people who don’t know how to do so to teach it.

“If you educate a boy,you educate an individual but if you educate a girl,you educate the whole nation”. Well written article highlighting that women need to take control of their financial life and need not be financially dependent on others!

I think your piece is “pure gold.” It alerts us to what is happening in the world of raising children. I appreciated the web sites you included and explored some of them. Hello everyone. Do you want your children to succeed in life? Get them started on the path to financial literacy!

Awesome to see financial literacy badges for Girl Scouts. Running your own systematic Bank of Mom/Dad is a great way for parents to teach their kids sound money habits in a way that is consistent with your specific family values. My favorite book on the topic is “The First National Bank of Dad” by David Owen (works for Moms too!).

We do the same “Spend/Save/Give” system with my 6 yo dd. Frankly, it seems to work almost *too* well. When she has money in her “spend” jar she can’t wait to spend it, and a couple of trips have been ruined because she was so fixated on finding something to buy with $6 – $7 that she ignored everything fun about the place or activity we were doing.

BTW, I am also a Girl Scout leader for my dd’s troop. A couple of weeks ago we took a tour of a nearby Wildlife Rehabilitation Center and each girl was to bring a small donation to the Center. Not only did our family donate some small items they needed, but my dd also made a card for them and put $13 from her “Give” jar in the card. She was so proud to know that she was helping them take care of the animals!

We just recently started marble jars. 3 kids (6yo, 4yo twins). They get marbles when they do their chores. Although not exactly the same as savings and spending however they see things (marbles) grow. When they hit a certain mark, 5,10, 15,20 so on they get a prize. We are hoping that this translates into earning, saving and spending money. Also it is interesting which ones “get it” and which one have a harder time.

I also believe that leading buy example is going to be a great lesson. We cant always get what we want.

we have been using dave ramsey’s envelope system for our kids. they get money for doing chores, and money deducted for bad behavior. we pay them cash once a week. money goes into three envelopes: spend, save, and give. they have to put a small amount into the give envelope to put in offering at church, spend is for candy, etc, and save is for a specific thing they are saving for: usually it is a wii game or lego set, etc. (we have 7 yr old twin boys) it has given them a real sense of ownership, and teaches them about goals, and gives value to money.

Great idea! My son has been managing his own monthly budget since 8th grade. He gets his money on the 1st of the month and I don’t want to hear about meals out with friends, video game releases, or whatever. He knows how to manage his money now (he’s 16 now). His Economics class at school just had them do a mock budget based on the starting salary of whatever career they’ve chosen – including in their budget rent, groceries, student loans, car insurance, health insurance, etc. What a great project!

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